A Cost-Effectiveness Study of Nursing Home Turnover Rates on Registered Nurse Staffing

Graduation Date


Document Type

Master's Thesis

Document Form


Degree Name

Master of Science



Department or Program Chair

Barbara Ganley, PhD

Thesis Advisor

Olivia Catolico, PhD, RN, BC


Background and Introduction

This study focused on the limited budget put forth by the government and considered alternatives to turnover rates and ways to improve quality of care in nursing homes. It has been shown that increased Registered Nurse (RN) care is much needed, at a threshold of 0.75 hours per resident per day for long-term care stay to improve outcomes. Anticipated benefits to residents include decreased adverse outcomes, increased quality and continuity of care. Potential benefits to registered nurse staff include job satisfaction with decreased patient-to-nurse ratios, and staff continuity for quality improvements in care delivery. Ultimately, a potential benefit to nursing homes and the government would be decreased costs and improved outcomes, and reduced spending for adverse healthcare outcomes respectively.


The purpose of this study were to:

  1. Determine the total nursing budgets used by Northern California nursing homes each year for the last five years in response to RN turnover to hire for new registered nursing staff and registry nurses for replacements.
  2. Determine the anticipated cost of nursing budgets with the regulated Registered Nurse hours per resident/day (FTE).
  3. Determine if there is a significant difference in current expenditures and expenditures if the facility increases the number of Registered Nurses within the facility.


Nursing home administrators of Northern California nursing homes eligible for Medicare and Medicaid reimbursements were surveyed, and chosen for data collection through convenience sampling based on their geographic proximity to San Francisco County. Nursing home administrators were asked to participate in data collection regardless of their age, race, ethnicity, or affiliation.

The instrument is a self-developed instrument by Yvonne Chan. As of completion of this thesis, there is no existing instrument that measures turnover rates to RN staffing in nursing home. The developed instrument includes nursing home demographics, facility, information, nurses’ information, and costs for operation and budgets.


All three facilities interviewed are for-profits, with 2 of 3 incorporating a rehabilitation/skilled nursing facility (SNF) focus, instead of a SNF focus only. For each new registered nurse it hired, it costs about $2000-$4000 for orientation, and preceptorship. Costs for the number of RNs hired in 2006 were between $4000 and $36,000 to staffing needs.


For each of the facilities to achieve the RN full-time equivalent (FTE) of 0.75 RN hour spent per patient/day, facility one would need to hire additional 5 full-time RN, facility two would need to hire an additional 1-2 full-time RN. The third facility staffs at 0.70-0.9 FTE, which exceeds even the federal recommended staffing ratios. Costs spent on overtime and per diem nurses are staggering, and ranged from $34,700-571,000 pei year. This dollar amount could potentially exchange LVNs for hiring of 1-3 full-time RNs instead. The benefits of such an exchange would improve quality of care and decrease turnover rates.


To increase staffing levels, the average Medicare and Medicaid reimbursement rates would need to be substantially increased. This study proved that some increase in current RN staffing is possible. The lack of Medicare reimbursements and the difficulty of RN recruitment to long term care settings may hinder the implementation of increasing RN staffing to the recommended 0.75 hours per resident day. Nonetheless, the importance of RN care needs to be highlighted as they are knowledgeable in assessing and intervening acute patient changes and preventing complications such as pressure ulcers and falls, and irreplaceable by licensed vocational nurses (LVN) or certified nursing assistants (CNA) for patient quality outcomes.

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